House Bill 2404 amends existing law and adds a new legislative-findings section. It reduces the special fuels tax by removing the tax increase that went into effect July 1, 2025 and planned future increases, and it amends RCW 82.38.030 to continue a $0.23 per gallon base tax while listing prior cumulative per‑gallon increases from 2003 through 2025. Beginning on the bill’s effective date the cumulative special fuel rate must be reduced to equal the rate in effect on July 1, 2016, and beginning July 1, 2026 the fuel tax rates listed in subsections (1) through (9) are to increase annually by 2% (rounded to the nearest one‑thousandth of $1). The amended section also specifies ten taxable events or conditions when the fuel tax is imposed (examples include removals from terminals/refineries, entries into the state, sales to unlicensed entities, blended fuels, dyed special fuel uses, and sales not removed from the bulk transfer‑terminal system). The bill also amends RCW 82.38.075 to create an alternative annual license fee in lieu of special fuel tax for vehicles using liquefied natural gas, compressed natural gas, or propane. It establishes a tiered fee schedule by gross vehicle weight (0–6,000: $45; 6,001–10,000: $45; 10,001–18,000: $80; 18,001–28,000: $110; 28,001–36,000: $150; 36,001 and above: $250), a formula tying each fee to the cumulative special fuel tax rate (multiply the schedule amount by the prior July 1 cumulative tax rate, divide by $0.12, round to the nearest $0.05; for 2026 use the 2024 tax rate), a $5 handling charge, proration to match staggered vehicle licensing, a decal or identifying device requirement to authorize purchases, prohibitions on dispensing into vehicles without a valid decal, applicability and exemptions (including references to IFTA and the International Registration Plan), and penalties for unauthorized dispensing as prescribed in the chapter. This is primarily a tax rate change and a new procedural/administrative licensing alternative, with enforcement and penalty provisions referenced. The extracted text does not identify the specific “department” responsible for administering the alternative‑fuel license program, does not state the bill’s precise effective date, does not include full definitions for terms such as “fuel licensee,” “special fuel,” or “IFTA licensee,” and shows deletions from prior law without the full prior‑law context.

If enacted, the bill immediately reduces the per‑gallon special fuel tax to the rate that was in place on July 1, 2016 by removing the increases that took effect (or were scheduled) in 2025, so refiners, importers, distributors, fuel licensees, and end users of special fuels will pay less per gallon at first. That reduction will likely lower state fuel tax receipts in the near term, but the law then requires automatic 2% annual increases to those tax components starting July 1, 2026, so fuel costs and tax revenue would rise gradually after that; the base fuel tax of $0.23 per gallon remains in place. Owners and operators of vehicles that use liquefied natural gas, compressed natural gas, or propane gain a clear option to pay an annual license fee instead of special fuel tax, with fees set by vehicle weight brackets and calculated from the cumulative fuel tax rate (with a special 2026 rule using the 2024 rate), plus a $5 handling charge and a required decal to buy fuel. That creates predictable, weight‑based costs for those vehicle owners, obliges fuel sellers to refuse service to vehicles without a valid decal (with penalties for violations), and shifts administrative duties to the unnamed department to issue decals, prorate fees, and enforce compliance. Key implementation details—such as the exact effective date of the tax reduction and formal definitions of terms like “special fuel” and “fuel licensee”—are not provided in the extracted text.